Correcting erroneous pay fixation does not permit recovery of excess payments from retired employees.

Rajan Prasad, a retired MTS (Tea Maker), sought pension fixation on the basis of Grade Pay of ₹2,400 and refund of amounts recovered from his retiral benefits.

The respondents maintained that his financial upgradation and pay had been incorrectly fixed under the applicable qualifying-service rules; after reviewing his service records, they revised his pension using a last pay of ₹36,100 rather than the ₹37,200 claimed by him.

The Tribunal considered separately whether the revised pay fixation should stand and whether the recovery of past payments was lawful.

Whether the applicant established entitlement to pension based on Grade Pay of ₹2,400.

Whether the respondents could recover excess payments made under the earlier pay fixation from the applicant’s retiral benefits.

Whether the applicant was entitled to interest on the recovered amount.

Section 19 of the Administrative Tribunals Act, 1985, provides the basis for an application to the Tribunal.

Under State of Punjab v. Rafiq Masih (White Washer), (2015) 4 SCC 334, as reflected in DoPT O.M. No. 18/03/2015-Estt. (Pay-I) dated 2 March 2016, recovery of excess payments is impermissible in specified circumstances, including recovery from retired employees and Group C or D employees, and where recovery would be inequitable, harsh or arbitrary.

Thomas Daniel v. State of Kerala, (2022) 5 SCC 545, supports the distinction between correcting an erroneous payment and recovering amounts already disbursed: the authority’s power to correct an error does not, by itself, establish that recovery is lawful.

The applicant did not establish, through the applicable rules or a specific upgradation order, that he was entitled to Grade Pay of ₹2,400 immediately before retirement; the respondents’ reliance on the relevant service records and the O.M. dated 1 September 2010 was not controverted by a rejoinder.

The Tribunal therefore upheld correction of the pay fixation and consequential pension revision.

The applicant was retired when recovery was effected, and the respondents attributed the earlier overpayment to departmental pay-fixation error; there was no material showing fraud, misrepresentation or deliberate concealment by him.

Applying Rafiq Masih, the Tribunal held that recovery was impermissible in the circumstances, without treating the refund as recognition of the claimed Grade Pay.

The respondents were directed to refund the amount recovered from the applicant’s retiral benefits within two months of receiving the order.

The revised pay fixation and pension were left undisturbed; no interest or costs were awarded.